The geometric mean is primarily a measure of location.
It is calculated by multiplying all the numbers in a data set and then taking the nth root of the resulting product, where n is the number of values in the set. This measure is particularly useful when dealing with data that is exponentially growing or when comparing different items with different properties.
For example, in finance, the geometric mean is often used to find average growth rates, as it provides a more accurate measure when numbers are multiplied rather than added, as in traditional arithmetic mean calculations. By using the geometric mean, we get a measure that better reflects the central tendency of multiplicative processes.